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Downturn in metals continues, coking coal continues to rise

* Strict imposition of zero covid strategy continues to weigh on the Chinese economy and consequently commodity prices, with Chinese domestic HRC down 2.2% and export offers at USD575/t.

* The People's Bank of China (PBOC) has asked China Bond Insurance Co. to extend support for bond sales by private developers to support the economy and avoid defaults by real estate developers.

* Iron ore futures in China fell to USD75/t, the lowest since Jan’19, on concerns of continued slowdown with blast furnace utilization also dipping down over the last two weeks. Coking coal prices were up 4% on (a) an impending La Nina season in Australia, and the rising Covid in Mongolia/China border, leading to slower delivery of coking coal and the possibility of China buying it in the spot market.

* In the domestic market, the spot HRC prices remained flat on a WoW basis at INR 56,300/t. Spreads between HRC and Primary Rebar turned negative suggesting a weak demand for HRC.

* The gap between the primary and secondary rebar prices was also negligible at INR800/t, reflecting a possible hike of INR 500-1000/t by primary producers.

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